What is UCITS?

The European Union defined undertakings founded for collective investment purposes such as mutual funds and investment trusts and arranged principles of their operation in a directive published in 1985.

Funds bearing the characteristics set out in the directive are named as UCITS (Undertakings for Collective Investment in Transferable Securities).

The term UCITS is used for the collective investment corporations which comply with the requirements of this directive. UCITS funds are offered to the investors in all EU member countries with the rights that they bear in their legal structure.

With UCITS III December 2002 directives, all UCIT funds received EU passport and right of free  circulation in EU countries.

UCITS directive has three primary purposes:

• To ease the process of offering mutual funds to investors in other EU countries;

• To establish a legal framework harmonized throughout the EU for mutual funds;

• To ensure the protection of investor rights.